ECB’s Lagarde: Macroprudential Policy Needs to Anticipate Crises and Build Resilience

26 September 2024

By Isabel Teles – FRANKFURT (Econostream) – European Central Bank President Christine Lagarde on Thursday said that emerging technologies could be a tool for macroprudential policy to anticipate and mitigate risks to the financial system.

In a speech at the European Systemic Risk Board (ESRB) Annual Conference, a text of which was posted on the website of the ECB, Lagarde said, ‘Policymakers cannot afford to simply respond to crises as they emerge. We must continually attempt to anticipate them, harnessing the power of technology and data to build a financial system that is truly resilient.'

It was important to balance the risks imposed by new technologies and consider how these could be used to make the financial system more resilient, she said.

'Our task now is to focus on how technological risks affect the interconnections and vulnerabilities across the entire financial system and ask ourselves how we may need to expand our toolkit', she said.

By using technology appropriately, macroprudential policy would be able to ensure that 'financial institutions are not only compliant with today’s rules but are also resilient to tomorrow’s threats', she said.